Saputo, the Canada-based dairy group, has welcomed a move to change the way milk prices are set in California.
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The company, Canada’s largest dairy processor, described the change as “positive news” with its milk costs set to fall.
A spokesperson for Saputo said the change to the formula for milk prices in California will ease the company’s commodity costs.
“This is positive news for us because 55% of Saputo’s US cheese production is in California,” the spokesperson told just-food today (22 November).
The market has also welcomed the news. In early trading today, Saputo shares rose to C$55.85 (US$56.71). The rise followed yesterday’s increase of C$3.80, or 7.5%, the biggest jump in the Saputo’s shares for seven years.
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By GlobalDataAnalysts have forecast that the rule change in California will boost Saputo’s profits but the spokesperson was refused to speculate on the impact to the company’s bottom line. “At the moment, this is good news for us but to what extent this affects profitability, we do not know.”
